Publication Type: Not Available
Authors: Irwin, Eve; Denslow, David
Division: Economic Analysis
In 1955, North Carolina trucking entrepreneur Malcom P. McLean bought a steamship company with the idea of transporting truck trailers with the cargo still inside. He realized that efficiency could be vastly improved if cargo could be placed in one container that was lifted from a vehicle directly onto a ship without first having to unload it. His ideas created the system of “intermodalism,” in which the same container, with the same cargo, with minimum interruption, could be moved seamlessly between ships, trucks, and trains during its journey. This greatly simplified logistical process eventually led to a revolution in cargo transportation and international trade. In 1961, the International Organization for Standardization (ISO) set standard container sizes. The 20-foot container, referred as a Twenty-foot Equivalent Unit (TEU), is the industry standard reference, and cargo volume and vessel capacity are now commonly measured in TEUs. The 40-foot container—2 TEUs—known as the Forty-foot Equivalent Unit (FEU) is the most frequently used container. By the 1980s, the introduction of double-stack trains further streamlined the intermodal system. Today more than 70% of general cargo moves in containers.